Present:

The Executive Board:

Øystein Olsen, Jon Nicolaisen, Egil Matsen, Hilde Myrberg, Kjetil Storesletten, Karen Helene Ulltveit-Moe, Kathryn M. Baker and Steinar Juel

Alternates:

Arne Hyttnes and Kristine Landmark

Employee representatives:

Mona H. Sørensen (items 216-221) and Nina Larsson Midthjell (item 218)

Office of the Supervisory Council:

Randi Almås (items 216-221) and Kristian R. Andersen (items 216-217)

Management:

Yngve Slyngstad (214-218), Trond Grande (214-218, 220-221), Dag Huse (214), Karsten Kallevig (216-218), Mie Holstad (216-218), Hege Gjerde (218, 220-221), Merethe Riddervold (214, 216-218, 220-221), Jane Haugland (219-221), Ørjan Agdesteen (218-221), Olav Bø (219), Helge Mothes (219), Geir Guldahl (219-221), Mads Kristensen (218-221), Torbjørn Hægeland (222), Ingunn Valvatne (214-224), Bjarne Gulbrandsen (214-224), Sigrid Igland (214, 216-224)

There were no comments on the meeting notice and agenda.

Item 214/2017 The Executive Board's investment mandate for the CEO of NBIM – limits for counterparty risk

Discussion document:

• Confidential memo from NBIM of 16 November 2017

Yngve Slyngstad and Dag Huse presented the topic.

The Executive Board decided to grant exemptions from the rating requirement in sections 3.3.1 d) II of [redacted text].

The exemption from [redacted text] given by the Executive Board of 18 March 2015 is to be rescinded following the conversion of participatory notes to shares.

Item 215/2017 Briefing on current issues in investment management

Yngve Slyngstad and Deputy Governor Egil Matsen gave a briefing on current issues in investment management.

Item 216/2017 Minutes of the Executive Board meeting of 25 October 2017

Discussion document:

• Draft minutes

The Executive Board approved the minutes of its meeting of 25 October 2017.

Item 217/2017 Supervisory reviews related to the management of the Government Pension Fund Global (GPFG)

Discussion document:

• Memo from the General Secretariat of 17 November 2017

Bjarne Gulbrandsen presented the topic and the draft response to the Supervisory Council.

The Executive Board decided that the attached letter should be sent to the Supervisory Council. The Governor was authorised to finalise the letter based on the Executive Board's remarks.

Item 218/2017 Budget for investment management at Norges Bank in 2018

a. 2018 Budget for investment management at Norges Bank (NBIM and NBREM)

Discussion document:

• Memo from NBIM of 16 November 2017

b. Limits for the accrual of performance-based pay in investment management for 2018

Discussion document:

• Memo from the Remuneration Committee of 21 November 2017

Trond Grande, Karsten Kallevig and Mie Holstad introduced the topic. Hilde Myrberg presented the position of the Remuneration Committee on total personnel expenses and limits for the accrual of performance-based pay in investment management.

The Executive Board exchanged views and asked clarifying questions about strategic activities, cost developments and the external comparisons made by CEM Benchmarking of the use of resources in the GPFG.

The Executive Board approved the proposed 2018 budget for Norges Bank Investment Management including Norges Bank Real Estate Management. As part of the Executive Board's budget decision, the Executive Board approved the proposed budget for total personnel expenses including performance-based pay. The budget for performance-based pay is based on a continuation of the scheme whereby up to 100 investment area employees at offices outside of Norway may be granted contracts that include performance-based pay limited to 200 percent of fixed salary.

Following the incorporation of remarks from the Executive Board's discussions, the budget proposal, together with the budget proposal for Central Banking Operations, is to be submitted to the Supervisory Council for final approval, cf item 220/2017. The budget proposal submitted to the Supervisory Council shall include budget limits for the operating expenses of operational entities within real estate management in the GPFG.

The Governor was authorised to finalise the letter to the Ministry of Finance with a proposed management remuneration limit for the GPFG for 2018 of 7.5 basis points.

Item 219/2017 Central Banking Operations' action plan and budget proposal for 2018

Discussion document:

• Memo from Corporate and shared services of 16 November 2017

Jane Haugland and Ørjan Agdesteen introduced the topic.

The Executive Board exchanged views and asked clarifying questions about activities in IT and IT security, cost developments at Norges Bank primarily compared with the other Nordic central banks.

The Executive Board approved the proposed 2018 budget for Central Banking Operations and took note of Central Banking Operations' draft action plan for 2018.

Following the incorporation of remarks from the Executive Board's discussions, the budget proposal, together with the budget proposal for investment management, is to be submitted to the Supervisory Council for final approval, cf item 220/2017.

Item 220/2017 Proposed budget for Norges Bank for 2017

Discussion document:

• Memo from the General Secretariat/Corporate and shared services of 16 November 2017

Ørjan Agdesteen presented the budget proposal.

The Executive Board had an exchange of views and approved the proposed budget for Norges Bank for 2018. The proposed budget is to be sent to the Supervisory Council for approval.

The Governor was authorised to finalise the document based on the Executive Board's remarks, including remarks in items 218 and 219.

It is assumed that the Supervisory Council authorises the Executive Board to make use of budget allocations according to approved investment limits. The Executive Board further authorises the Governor to make use of allocations within the investment limits.

Item 221/2017 Updated regulations for financial management at Norges Bank

Discussion document:

• Memo from Corporate and shared services of 16 November 2017

Jane Haugland presented the discussion document.

The Executive Board adopted the updated regulations for financial management.

Item 222/2017 Issuance of commemorative coin in 2014 to mark the bicentenary of the signing of the Constitution of Norway – Final report and financial statements

Discussion document:

• Memo from Financial Stability of 13 November 2017

Torbjørn Hægeland presented the discussion document.

The Executive Board took note of the final report and financial statements for the silver coin issued in 2014 to mark the bicentenary of the Constitution.

In accordance with recommendations from the Storting's Presidium, the Executive Board approved the use of the NOK 2,588,299.90 profit for two dissemination projects organised by the museum, Eidsvoll 1814.

The Ministry of Finance is to be informed of the results of the commemorative coin project and the decision on the use of the profit.

Item 223/2017 Briefing on current issues in Central Banking Operations

The Governor gave a briefing on current issues in Central Banking Operations.

Item 224/2017 Any other business

There was no other business.

Documents distributed for information together with the discussion documents:

• Agenda for the Executive Board Seminar for 21 November 2017
• Investment strategy for the Government Pension Fund Global, Letter from Norges Bank to the Ministry of Finance of 14 November 2017
• Norges Bank's annual reports for 2017 – Plan and schedule, Memo from the General Secretariat of 16 November 2017
• Minutes of the Risk and Investment Committee meeting of 25 September 2017
• Report from the Audit Committee meeting of 23 October 2017
• NBIM Report – GPFG Performance and Risk October 2017